Factors That Influence Effective Strategic Planning ...

1 IOSR Journal of Business and Management (IOSR-JBM) e-ISSN: 2278-487X, p-ISSN: 2319-7668. Volume 16, Issue 6. Ver. II (Jun. 2014), PP 188-195 188 | Page Factors That Influence Effective Strategic Planning Process In Organizations Job Kipkemboi Kiptoo, Dr. Fred Mugambi Mwirigi, 1,2 Jomo Kenyatta University of Agriculture and Technology. BOX 81310 80100, Mombasa, Kenya Abstract:- The general objective of this study was to identify Factors that Influence Effective Strategic Planning process in organizations. It looks closely at the key Factors that Influence Strategic Planning and why organizations have to plan for the future for them to remain relevant in the market. This will be achieved by aligning Strategic plan with the vision and mission of the organization.

2 The study explores the connection between Strategic plans with organization structure, organizational culture, leadership and human resources. This paper specifically analyses the Factors that Influence Strategic Planning and recommendations that can be employed in order to have a successful implementations of Strategic Planning in the organizations. The recommendations will also address the gaps that have been identified in this paper. Keywords:- Strategic Planning , organization structure, organizational culture, human resource I. INTRODUCTION A Strategic plan is a set of processes undertaken in order to develop a range of strategies that will contribute to achieving the organizational direction (Tapinos et ). Therefore, this clearly indicates that companies have to arise to the occasion that they have to develop strategies that will drive the organization in achieving the set goals and objectives as per the vision and mission of the organization.

3 By doing so then the organization will have to formulate strategies that will guide to the direction and the future of where they want to be as an organization. All organizations have a dream to achieve and in doing so they have to have strategies that will propel them to the destination. Strategies can be formulated in three levels that is: corporate, business, and functional level. At corporate level strategies are formulated by the top management or the board of directors (Yabs, 2010). At business level strategies are formulated by middle level managers for example, marketing managers, human resources, production managers, logistics managers among others (Yabs, 2010). strategy formulation at functional level is done by first line managers or supervisors (Sababu, 2007) In organization, the Board of Directors are responsible for the long term decision and corporate strategies that should be implemented by the management in order to achieve company s objectives.

4 The Managing Director is expected to lead the management team in ensuring that the corporate strategies are implemented to the latter. The Board is responsible to the shareholders hence giving direction to the management team in order to ensure that the shareholders get return on their investments. The senior top management are expected to ensure that the Strategic plans that the board has approved is supposed to be implemented. This means that the management is expected to offer leadership and guidance s on the direction the company should take while undertaking the process of Strategic plan. This plays key role in formulation of Strategic plans in the organization. For organization to succeed in strategy formulation, it s important for organization to analyse its environment in which they operate by using tools such as the Swot analysis, Pestel analysis, the Porters five forces model, competitor analysis and gap analysis among others (Aldehayyat, Al Khatab and Anchor, 2011) The Swot analysis is a very powerful tool that helps organizations to address issues relating to strength, weaknesses, opportunities and threats within the organization.

5 If this tool is used, it will helps researchers to understand how the organization can use its strength to take advantages of the opportunities and how organization can use strengths to overcome the threats that the organization is likely to face. Swot analysis is tool that can be used by organization in order to plan how to overcome the several identified weakness and take advantages of the opportunities. This also helps the organization in minimizing the weakness over the threats. Pestel Factors is another tool that organizations uses when formulating strategies because it helps the organization to identify the impact and effects of politics, economic, social, technology, environment and legal aspects on its operations.

6 This will help the organization management team to act appropriately on issues that requires to be addressed especially when the environment in which they operate in is very hostile. Failure to use this tool and respond appropriately after analysis of the organization operations and its environment, it will be Factors That Influence Effective Strategic Planning Process In Organizations 189 | Page difficult to respond appropriately to the needs of the customers and other stakeholders. This may impact on the performance of the organization. Because of this, the organization will become irrelevant, making the company to have negative image. This will be evident by the low number of the customers that the organization will be able to attract or acquire hence impacting negatively on the customer service of the organization.

7 Once the environment has been analysed using the appropriate tools, the organization management is able to come up with the organization vision, mission and organizational values that will drive the organization achieving its objectives. Its important for organization to understand that Strategic plan is a process and must be undertaken to its logical conclusion. This means that the logical conclusion will be the actual implementation and the monitoring and evaluation of the entire Strategic plan. II. OBJECTIVE The general objective of the research is to investigate Factors that Influence Strategic Planning in an organization. The specific objective of the research will be as follows, 1. To investigate how organization structure affect the Strategic Planning in an organization 2.

8 To establish how leadership affect Strategic Planning in an organization 3. To investigate whether organization culture Influence Strategic Planning in an organization. 4. To establish how human resource Influence Strategic Planning in an organization III. LITERATURE REVIEW Many scholars agree that a Strategic plan needs to be simple, realistic and neither too ambitious nor insufficiently demanding (Leggate and Thomas, 1977; Aldehyyat et al., 2011). It should allow some degree of flexibility to fit with the changing environment. Mintzberg, 1994 adds another perspective by highlighting the danger of Planning in that it assumes the world will stop while managers wait to plan and implement strategies. This clearly demonstrates why Strategic plans should be made in such a way that it is flexible to accommodate environmental changes and other effects that can Influence the prevailing situation.

9 Most organizations in the current trend are converging in big and luxury hotels in order to come up with the most appropriate Strategic plans that suit the organizations. In today s world, most of management teams or managers of organization, profit and non-profit organizations spend considerable time, energy and money for formulating and assigning basic strategies of their organizations. However the biggest problem is the implementation of the strategies that are able to elaborate clearly the company s vision but the employees have a different perception of that, this may have negative Effective in achieving company s objective that are derived from the vision. This means that the management must be prepared to ensure that all the employees in the organization understand the importance of Strategic plan.

10 ORGANIZATIONAL STRUCTURE Every organization has a unique structure that reflects its current image, reporting relationship and internal politics. Okumus (2003:876) defines organizational structure as the shape; division of labour; job duties and responsibilities; the distribution of power, and decision-making procedures within the company . Louw and Venter (2006:406) suggest the following definition: The formal pattern of interactions and co-ordination designed by management to link the tasks and patterns of individuals and groups in achieving organizational goals . Okumus (2003) cautions that issues for consideration must include: the impact of a new strategy on potential changes in duties; roles; decision making; and on reporting relationships.